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Discussion Paper Details

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Title: Pandemics and Local Economic Growth: Evidence from the Great Influenza in Italy

Author(s): Mario Carillo and Tullio Jappelli

Publication Date: June 2020

Keyword(s): Great Influenza, mortality and growth and regional growth

Programme Area(s): Macroeconomics and Growth

Abstract: We investigate the link between the 1918 Great Influenza and regional economic growth in Italy, a country in which the measures implemented by public authorities to contain the contagion were limited or ineffective. The pandemic caused about 600,000 deaths in Italy, a death rate of about 1.2%. We find evidence of a strong and significant adverse effect of the pandemic on regional growth. In particular, going from regions with the lowest mortality to those with the highest mortality is associated to a decline in per capita GDP growth of about 6.5%, which dissipated within three years. In line with this finding, we also estimate a small and transitory negative effect of the influenza on industrialization. Our estimates provide an upper bound of the adverse effect of pandemics on local economic growth in the absence of non-pharmaceutical public health interventions.

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Bibliographic Reference

Carillo, M and Jappelli, T. 2020. 'Pandemics and Local Economic Growth: Evidence from the Great Influenza in Italy'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=14849